Zcash Activates NU7 Upgrade, Recycling 60% of Fees for Future Rewards

Zcash activated its NU7 upgrade at block 3,543,405 on Nov. 5, putting a system in place to recycle transaction fees into future miner rewards while preserving the network’s 21 million ZEC cap.

The Network Sustainability Mechanism removes 60% of each block’s transaction fees from circulation; miners receive the remaining 40%. The removed ZEC is scheduled to return gradually through block subsidies beginning at block 8,939,664, expected around February 2031. The fees are recycled rather than permanently destroyed, and the change leaves the 21 million ZEC supply cap intact.

NU7 also cuts the target time between blocks from 75 seconds to 25 seconds. The scheduled subsidy per block drops to one-third of its previous level, keeping daily ZEC issuance unchanged. The fee mechanism is designed to support network security as scheduled rewards shrink.

Separately, proposals in the Zcash community’s development-funding process are due by 6:59 p.m. ET Nov. 8, with coinholder and community-panel polls scheduled for Nov. 16-30.